A Matter of Trusts

When opponents of the Historic District couldn’t garner enough legitimate objections to constitute a majority, 4 households took matters into their own hands and created 5,000 “objection trusts”. An objection trust is a trust created and added to the deed of a property for the sole purpose of objecting to the HD. In creating these objection and then filing the objections, the outcome of the HD nomination has shifted dramatically. The inclusion of these trusts and their objections gives the appearance that 82.8% of property owners in Eastmoreland object to the HD, but the reality is that only 43.5% of owners object. In other words, these 4 households (all HD opponents) skewed the results by giving themselves 70% of the voting power.

We’ve gotten lots of questions about these trusts. Here are answers to the common ones…

Who created all these trusts?
Just four households created 5,000 trusts. These homes have just 7 legitimate owners, 5 of which were responsible for creating the trusts. They are:

Some of these individuals hold occupations or roles where you would expect ethical behavior. If they are willing to stoop to this level for a neighborhood issue, what reason is there to believe that they would behave ethically in their profession? It’s a good question for the employers of some of these individuals: Merrill Lynch, law firm Barran Liebman, the Multnomah Bar Association, and Trimet.

How do we know this has been done?
This is all a matter of public record. The local media has written about this and you can find links to recent news here.

Is this legal?
While it is highly unusual (unprecedented?), it is not illegal to create 1,000 trusts on a property. That said, the purpose for creating these thousands of trusts is certainly unethical. It’s also not clear whether the state legally should have counted these trusts as owners or allowed their objections.
Additionally, it’s pretty clear that the use of these objection trusts is not within the spirit of the law or regulations. It’s a clear abuse of a process which is meant to afford a single vote or count to each person.

How can this be allowed?
HEART doesn’t believe it should be allowed, but the Oregon SHPO and the Oregon Department of Justice (DOJ) have permitted it by counting these fabricated trusts and their objections. We do not believe that these state departments have properly interpreted either Oregon state law or the National Park Service (NPS) guidelines. Barring some voluntary reversal by either the SHPO or the DOJ, it will be up to the NPS to decide whether these should be allowed.
The NPS rules don’t specify a minimum ownership percentage, so these trust creators exploited this even though each individual trust only owns a 0.1% or 0.05% interest in the property.

Can’t supporters do the same thing and create thousands of trusts?
Yes, however it never occurred to supporters to try to game the system in this manner. It’s evident that the only reason this tactic was used by opponents is because they could not fairly achieve a majority of owners to object. These opponents have claimed that the process is undemocratic, but then willingly threw democracy out the window when it served their purpose to do so.

Why use trusts?
The rules established under the National Historic Preservation Act actually don’t mention trusts at all. Guidance issued by the National Park Service, however, have indicated that trusts get a vote when they are listed as the property owner. And the Oregon SHPO has applied this blanket guidance even though the situation where objection trusts were created by the thousand was never envisioned.
The likely reason that these individuals employed the use of trusts is that they can use revocable living trusts which allows them to retain full control of their property. We know that they each named themselves as trustees.
To see how these deeds were recorded with Multnomah county, use the following links:  Altstadt, Cummings, Hetfeld-Schpak, Zeidler/Frishberg

What can be done about this?
If you’re troubled by the use of this scheme by these individuals to disenfranchise the rest of the neighborhood, you are not alone. The best thing you can do is contact representatives and department officials to let them know you don’t agree with the actions of these individuals and request that the state and NPS not count them. You can find a list of individuals to contact here. And you may contact HEART via email to get involved in other ways: iHEARTeastmoreland@gmail.com